Singapore Press Holdings (SPH)

[yeokiwi]

With the kind of reputation that SPH and Mediacorp are having, it would be a miracle if they can make any inroads into any countries.

No reputable newspaper in this world would ever want to be bought over by SPH. Being bought over is as good as destroying the newspaper.

eh, pardon my ignorance, what's wrong with SPH newspapers? I think they are doing a good job managing content, editorial directon, color etc. Consider too that many of their overseas brethren has lost money. Their challenge is about media moving from print, and of course expanding overseas is about politics etc. But value destroying and bad reputation? What are you refering to?

Newspaper worthiness is rarely viewed from the profit point of view. Typically if it is so, then tabloids were probably ranked very high in the list. The reputation of a newspaper lies in the ability of the editors and reporters to deliver views and reports in all angles.

The general impressions that the SPH's newspapers give is typically they are government mouthpieces. Whether they are indeed operating as government's mouthpieces, I am not sure. Maybe the government is not meddling and it was simply a case of self-censoring.

Probably your impression of local newspaper is different but from what I had read and felt, I thought it was almost a common understanding among the SPH reporters that they have to be very careful in criticising government policies.

It may be just self censoring but in the extreme view, they are thought of as government's lackeys.

Assuming that somehow, SPH is interested to buy over Wall Street Journal. What do you think is the reaction of the editors, reporters and the readers of WSJ?

I think the readers will write in to protest and the editors and reporters may resign to join other papers.

Just my opinions only..

[Risk Adverse]

Putting our political affiliations aside, a merger between SPH and Mediacorp makes a lot of business sense. There is a lot synergy. Instead of competing against each other for advertising revenue they can work together. Of course, turning such a merger into a media giant like NewsCorp or CNN is another matter. That is an audacious undertaking that needs an equally audacious management.

[mikh]

Tks YKW,MW, now i understand what you meant about reputation and destruction

hmm, when i first started reading ST regularly, it was pretty govt sided. My own letter was published after edition to give the opposite impression of its original intent! Reading it nowadays in the last 10 years, i feel there has been improvement. Forum pages see much more flak and some other articles are critically written. The reason could perhaps be the same as why there are NMPs, non-elected Opps in parliment but that's not the point. In short, i won't paint it that badly.

Still, if we accept that the newspaper of the land (in Asia bar HK/India(?)) is likely to be a mouth-piece somewhat, i don't think SPH is doing so badly. Political independence aside, i think it covers the news well and syndicates articles well from rich global resources. I read a newspaper for its topical news coverage and relevant information/analysis worldwide. Tabloids are too trashy and attention seeking targetted at different segments. Also, advertising plays a big role in newspapers.

Nevertheless agreed, WSJ readers would not accept SPH taking over more because of the political independence expected - than any other reason. And we agree that SPH papars would have great difficulty expanding overseas for political reasons, and I now add editorial independence.

[Ben]

After reading all the previous posts, I am left with the impression that most of you think that SPH fails to publish a reasonable quality newspapers. Most feel that our paper are biased, or is a government mouthpiece whatsoever. I do agree with you to a certain extend. However, we are talking about the investment merits of SPH and I feel that we cannot use the conventional ways to measure the investment merits of SPH. In most other situation, the quality of a company‘s products determine if the company is worth investing, but in SPH case, I am of the opinion that it is not, or at least not the primary factor. My reasoning is simple. SPH has a monopoly of the newspaper market here, and this is unlikely to change in the future. Government is opening up market for competition in telecommunication, transportation, banking and finance etc, but there is no mentioned about newspapers. Reason could be what some of you have mentioned, i.e. our papers are controlled and preferred to be so. And because SPH is unlikely to lose its monopoly status, they have and will continue to enjoy this unfair advantage. Such a company will continue to perform well even if its products are not good enough (if compared to other) or its management team is not smart enough. I think WB has said something like this before: that it is better to invest in a company that even a fool can run. I am not implying that SPH is run by fools; in fact, I think they have some of the brightest people to manage the company. What I am saying is that the profitability of SPH is not so much affected by its quality of management or quality of products mainly because of its monopoly status. If SPH were to operate in the USA for example, then I am sure they will have a much tougher time than now.

On the other hand, even if government decides to open up newspaper market for competition, I doubt they will be any new entrants. A small market dominated by a dominant player is unlikely to be attractive to others.

Also, it seems that many readers nowadays are not really concerned about the quality of newspapers. Many don’t read papers for the political, economic or world news anymore. There are more interested in all the numerous sales advertisement run by so many advertisers.

I am vested in SPH and so my view may not be objective. So far I am happy with the attractive dividends I received each year and should SPH continue to pay at current rate, I will be able to recoup my cost in less than 10 years’ time.

[Musicwhiz]

Also, it seems that many readers nowadays are not really concerned about the quality of newspapers. Many don’t read papers for the political, economic or world news anymore. There are more interested in all the numerous sales advertisement run by so many advertisers.

Hi Ben,

I agree with your view on SPH and newspapers in Singapore; I doubt the Govt will allow another entrant as far as I can see (unless something radical happens at the next GE!).

But I don't agree that many don't read papers for the editorial content. I for one do, and love to read commentaries on politics, economics, business, social issues and entertainment. In fact, I almost completely ignore the sales adverts and A&P in the newspapers, and just focus on the content.

But maybe I am different? Haha.

[Nick]

I tend to read the Money section first, then the Sports and lastly the editorials. If I have time, I will read the world and prime news haha !

[Ben]

But I don't agree that many don't read papers for the editorial content. I for one do, and love to read commentaries on politics, economics, business, social issues and entertainment. In fact, I almost completely ignore the sales adverts and A&P in the newspapers, and just focus on the content.

But maybe I am different? Haha.

Hi MW,

I am sure you do read, and I am sure many in this forums will also read the editorial content. However, I just realise that many in my office are more keen on sales adverts and they can spent lots of time discussing on it like it is some important world news..hahaha..some even do paper cutting on sales offers..I think that is the reason why we have free papers (Today, My Paper) these days that survive solely on ads revenue.

[Satchmo]

Readers nowadays are more interested in sales ads in ST? Really? I suppose that's good news: Ad revenue will continue to flow, reader-shoppers will be pleased with their shrewd purchases, GDP will be helped along. ST happy, Ppl happy, Gov. happy.

I wonder if Sg can support 2 major presses. Enough news to go around?

Incidentally, any of u think that the full page ads by motoring companies are effective? Must be, since they keep doing it week in, week out.

[Risk Adverse]

SPH is trying to find new growth engines.
It ventured into property and have some success.
Now that sky@eleven is finished, there is a void.
They need to build up land bank for future developments.

In the meanwhile, their forays into malls have been a learning curve.
Paragon has been a good investment.
However their inexperience showed when they bidded too high for Clementi Mall.

SPH need to maintain a steady dividend stream.
So far they have been delivering.
My only grouse was when they had compulsory buyback some years back.
This caused me to end up with odd lots.
Now, they have wised up and do buyback on the open market.
This way they support stock price without creating odd lots.

Ultimately I would like to see SPH acquire Mediacorp.
SPH already owns 20% of Mediacorp.
They is sitting on a healthy pile of cash.
They should use their cash to buy Mediacorp from Temasek.
Temasek has been selling assets to raise cash.
So why not make an offer for Mediacorp.

[mikh]

Based on the current regime, I don't see Temasek giving up control of Mediacorp. Oh it might float a non-controlling portion of it but just like its other units, Mediacorp would similarly be considered a "strategic asset".

I was initially confused as well but i think it is correct for me to say that SPH owns 20% Mediacorp TV, not Mediacorp which is 100% owned by Temasek.

On the other hand, even if government decides to open up newspaper market for competition, I doubt they will be any new entrants. A small market dominated by a dominant player is unlikely to be attractive to others.

I agree that SPH is a formidable monopoly against new entrants. However, for the sake of understanding SPH better, I doubt that it is cut and dried that the newspaper market is closed by the Govt. Streats was by SMRT and ?? (I believe not SPH) and neither was TODAY (mediacorp). I think there are still some surviving independent mini papers being distributed as well. We all know what happened to Streats and TODAY subsequently, but my point is that others did get permission to print. In fact, that period of Mediacorp+Today vs SPH+Channel U+i was an interesting time for consumers and for us to witness some nice strategic maneuver by respective companies. Unfortunately, somebody decided that competition wasn’t all that great and there was (and still is?) some “cope-out”.

I see the SPH landscape as “media”, not just newspapers and their management seem to agree . From a competitive analysis, Mediacorp is then a clear direct competitor (still!). From SPH’s strategic perspective, it has made some right moves. It has bought over lots of magazines from smaller players, has a chunk of internet sites (hardwarezone, shareinvestor.com, rednano (dying?), some failed), is positioned for exhibitions via Sphere and has one of the larger billboards in Orchard Rd. There IS good direction, not random exploits looking for business; although I think property is not in the equation.

One question I have not been able to ascertain. Who is SPH’s controlling shareholder? You don’t see Temasek there and the key player/s seems hidden behind nominees. I suspect OCBC – then, interestingly not pure govt per se! And if so, that changes perception somewhat yes? Anyone can help?